During the November 2019 protests, the Iranian people stood up to oppression and set fire to symbols of deception, looting cells, and repression centers in order to shout their demands for a just and free society.
Banks were one of the symbols that were attacked by the outraged people in these protests. Citizens realized that these centers were holding onto funds of the corrupt officials. Furthermore, authorities had turned banks into a place to earn windfall profits and the rooms for taking and not repaying multi-billion-rials loans.
When Hassan Rouhani’s administration announced the increase in gasoline prices, the army of the hungry and the unemployed started their protest movement by setting fire to gas stations, and then they attacked oppressive centers and burned them down to ashes in the flames of their anger.
One week after the November protests, government-linked figures began publishing statistics on the extent of destruction and damage to their financial centers.
“Senior banking officials have learned that at least 900 bank branches across the country have suffered minor and total damage in the past week. Preliminary estimates indicate the total or partial destruction of at least 3,000 bank ATMs,” Hamshahri daily wrote on December 4, 2019.
“The number of branches of banks and credit institutions operating in the country was 21,319, which, considering the damage of 900 branches during the recent unrest, at least 4.2 percent of the total active branches have been excluded from the service cycle,” the state-run daily added.
The Secret of Banks’ Destruction in Protests
Government officials, seeing the amount of damage they suffered, began to think about the reason for the anger against these institutions.
“The extent of the destruction of bank branches and equipment due to the unrest after the increase in gasoline prices is considerable and it is necessary to answer the question: what is the secret of this destruction?” Aftab News website wrote on November 24, 2019.
They came to this conclusion from their thoughts, evaluations, and observations on the scene. “In a more general view and a look at the historical trend of several years, it is clear that the level of trust in banks has been damaged and has intensified anger and violence against the banking network,” they wrote.
“Both the banks and the government, as well as policymakers and experts, are to blame for the formation of this negative mentality and the decrease in the level of public trust in banks,” officials acknowledged.
The Donya-e-Bank daily also mentioned the people’s fury against banks. “From this perspective, criticism is sometimes so intense that some intellectual leaders and theological and economic experts present Iran’s banking operations as suspicious of usury and banks as the cause of all economic misfortunes,” Donya-e-Bank wrote on November 25, 2019.
“From this perspective, when the majority of people face many difficulties and obstacles to receive banking facilities in times of trouble and livelihood pinch and witness the unveiling of some macroeconomic corruption through the banking network channel due to the prevailing relations instead of rules in economics and business, the formation of a hidden anger against the banking network will not be unexpected,” the daily added.
Then, Tabnak website also highlighted the unbelievable scale of corruption in Iran’s banking system. “Every year, banks’ financial statements show an increase in the purchase of their real estate, the payment of loans to their employees, the payment of salaries and some astronomical benefits to the board of directors, the payment of loans with low-interest rates and long repayment period to board members, etc. and this intensifies the dissatisfaction of the people,” the state-run website wrote on November 24, 2019.
They also point out the difficulty of financing from banks to start businesses, which is one of the obstacles in the way of the people.
“In the latest report on business environment monitoring, which is related to the summer of 2019, the difficult component of financing from banks has been proposed as the second obstacle in the way of businesses,” Tabnak added.
Facilities in the Service of the Rich
A report prepared by the Parliamentary Research Center on the Business Environment in 2016 pointed out the problems of obtaining facilities for small and medium enterprises from banks.
According to the Chamber of Commerce of Iran, in the same year, the region of Southwest Asia, including Iran, are among the countries where more than 59 percent of small and medium enterprises are deprived of bank credit.
On the other hand, the Monetary and Banking Research Institute of the Central Bank of Iran (CBI) shows that the ratio of Iranian households using banking facilities from 1985 to 2013 was at best only 17 percent. This ratio decreased to 12 percent in 2016.
“Household budget data for 2016 show that the number of people in the tenth decile [affluent classes] who have received facilities is 5.4 times the number of people who are in the first decile and have received facilities,” Jahan-e Sanat daily published a summary of the CBI 2016 report on November 2.
This statistic clearly shows that influential government officials and their supporters have used banking facilities more than the lower classes. Interestingly, the same report states that 54 percent of bank deposits are registered in Tehran province, which is the gathering place of the main officials. While the lowest deposits were in the provinces of Sistan and Baluchistan, Kurdistan, Kohgiluyeh and Boyer-Ahmad.
10 Percent of National Income at the Disposal of 0.5 Percent of Population
“53 percent of the number of bank deposits belongs to one percent of depositors (100th percentile). The top two percentiles of household expenditures account for 10 percent of national income, and the top three percentiles account for 13 percent of national income,” Jahan-e Sanat cited the Labor Ministry statement.
Today, anyone who enters the afflicted land of Iran sees the poverty and misery on the faces of the people in such a way that it may not be necessary to show all these figures to understand why the brave youth of Iran in every protest attack the banks.